For the last several months, as I began to realize that the responsibility of serving as President of ALTA® was fast moving upon me, I began to really think about ALTA® -its mission - its accomplishments - and its future. I studied the different functions of ALTA®, admittedly with a critical eye, sort of asking "what if." What if we just didn’t do that? I began to appreciate all that ALTA® has done historically, and that it has done it extremely well.
But just like each of our organizations, it is being demanded to change, and there is this sense that ALTA® doesn’t know exactly what to change, and there is this edge to our existence as an organization, a boundary we have set for ourselves- a boundary we can’t seem to move - and yet our members or potential members are going outside that boundary and finding something useful in the likes of Respro or Titletech.
The value proposition of title insurance continues to evolve and be tested. Our traditional customer sets, particularly on the mortgage origination side, are narrowing their demands for the title product, yet broadening their demands for a package of services. The redefinition of our industry is quite clearly captured by those two trends.
Redesigning the Industry
The industry is responding to those market forces and the compelling new utility of electronic commerce. The most visible industry expression of this is, of course, the highly promoted activities of the major underwriters. Which major underwriter isn’t touting connectivity, Internet presence, and some form of facility for one-stop shopping?
For the title industry and its members to remain a viable part of the national economy, we must continue to have our business expertise, information services, and financial assurances remain integral to the process of real estate transfer. What we do isn’t going away - but, like every business I can think of, it is being transformed.
As consumers, for almost everything you shop for, it’s more of a commodity experience today than it was five years ago. For us, the commoditization is much more attached to the information services and financial assurances. The key component is the customized or personal service we can wrap around that experience, especially the addition of our business expertise. There is still plenty of room for that as our customer base looks to expedite the real estate closing process.
And, because of that, the value proposition of ALTA® continues to evolve and be tested.
Goals for the Future
In the upcoming year, I think it is very important that we progress even further in three areas where our progress has been pretty good over the past couple of years: 1) continue to develop our grassroots efforts; 2) grow the scope and the reputation of our Technology Forum & Expo; and 3) grow the scope and enrollment in the Management Development Program. By themselves, they are no easy challenge. But the top priority I think for the year is something that is not going to be a one year project. In terms of long-term effect, probably the most important thing that can be done this year is the strategic planning effort - the laying out of strategies to begin to expand the boundaries of ALTA®.
The Role of ALTA®
The role of ALTA® depends on industry consolidations and the extent of the encroachment of controlled or affiliated business operations into the title insurance market. Fewer major underwriters probably means a change in structure and is inevitable in some form or fashion, because there is going to be less, not more funding coming from that source. How many additional fee-based products or services ALTA® can provide is one key.
What happens within the agents’ section is another key. I don’t know what took me so long, but I have come to understand that whatever success and value is achieved from ALTA®, the critical success factor is an involved and dedicated agents’ section.
And it is becoming more critical. The underwriters either have become too big or too few or both. Are they actively involved? And as for agents, what about the scope and depth? How do we get more agents to appreciate that they do have an interest in ALTA® - there are so many agents who belong only to their state association.
And so, given that, I would submit that the potential power of and value of ALTA® lies with two things: Expanding the depth and scope of our agency base; and attracting new constituencies involved in the Real Estate Information Services business into our fold. In consideration of that, we may need to rename ourselves, something more inclusive of those other appropriate constituencies. But that is just food for thought as we begin to develop a way to expand our boundaries and add to the value proposition of ALTA®.
This is not a one year thing, and while we may get it started this year, it will only succeed if it is carried on. It is something that all of the members of the Board who are in the chairs to succeed to this President’s position are going to have to agree on.
And so we have our work cut out for us. But it is important and it is exciting and I am very much looking forward to working with all the component groups of ALTA®. These are all talented and dedicated people, whom I know I will enjoy working with over the next year, as we work together to shape the title industry of the new millennium.
I welcome your feedback on the direction of our association.
Charles H. Foster, Jr.